Coffee Day gets first tranche of Rs 2,000 crore after disinvestment in GV Techparks

Coffee Day Enterprises Ltd (CDEL) has received the first tranche of Rs 2,000 crore following disinvestment of Global Village Techparks to repay debts following the death of its founder V G Siddhartha.

Bengaluru (Karnataka) [India], Mar 30 : Coffee Day Enterprises Ltd (CDEL) has received the first tranche of Rs 2,000 crore following disinvestment of Global Village Techparks to repay debts following the death of its founder V G Siddhartha.

In August last year, CDEL executed definitive agreements with entities belonging to Blackstone Group and Salarpuria Sattva Group for investment in GV Techparks, a wholly-owned subsidiary of group company Tanglin Development Ltd (TDL), at an enterprise value of Rs 2,700 crore.

The balance amount is expected to be received after the receipt of few statutory approvals, CDEL said in a statement.

"Out of the money received in first tranche, the company has paid off its debts in full including principal and interest amounting to Rs 1,644 crore to the lenders despite difficult economic conditions," it said.

Post this payment, the consolidated debt of the company and its subsidiaries stands at Rs 3,200 crore as on March 27. This includes debt of Rs 1,400 crore of its subsidiary Sical Logistics Ltd where disinvestment process is in progress.

"The company and subsidiaries have repaid around Rs 4,000 crore to the lenders since the beginning of this financial year," CDEL said.

"With the continuous support of stakeholders of the company, the current management is working to ensure better liquidity and operational efficiency. The company is confident of the future ahead despite various challenges," it added.

The company has been in rough waters after its founder V G Siddhartha took his own life as debt strains began to emerge in his company. Since his death in July last year, CDEL has been trying to divest its assets to pare debts.

On July 30, 2019, CDEL informed stock exchanges about Siddhartha's disappearance. In a letter that was purportedly written by him, the Cafe Coffee Day founder said: "I could not take any more pressure from one of the private equity partners forcing me to buy back shares."

( With inputs from ANI )